Vranich: Light Rail Uncertainty 'Extremely Concerning' to Developers

Darko Vranich, President of property development company Vrancor Group, has written a scathing letter in support of Hamilton's light rail transit (LRT) plan in the face of recent Council uncertainty.

Construction in progress at 150 Main West (RTH file photo)

The developer responsible for Staybridge Suites at 20 Caroline Street South, Homewood Suites at 40 Bay Street South and the 150 Main Street West condos warns that Council rejecting full provincial funding for LRT "would send a very negative message about the direction of the City to developers both inside and outside the City."

Vranich writes that it "is extremely concerning to those of us who are investing in Hamilton" to find out that Council is suddenly unsure whether it supports the LRT plan.

He adds that many developers "are keenly interested [in] the opportunities that the LRT initiative will provide" and that "there will be a flood of new development proposals" once the construction begins.

Reports in the news media about the re-ignited debate over Hamilton's Light Rail Transit initiative are very alarming to both me and many others in Hamilton's development community.

It is fair to say that virtually everyone, myself included, in Hamilton's development community understood this to be a done deal.

We were of this understanding because Premier Kathleen Wynne herself came to Hamilton to make the announcement. City Council requested 100 percent provincial funding of the $1 billion cost of this initiative and that is exactly what the Premier delivered.

To learn now that there is a question mark over the initiative, and indeed it is in jeopardy, is extremely concerning to those of us who are investing in Hamilton.

Council got everything it asked for: a $1-billion, fully-funded project. To turn that down now would be tantamount to snatching defeat from the jaws of victory.

My company has made more than $200 million in investments in Hamilton, inculding two hotels - Staybridge Suites on Caroline Street and Homewood Suites by Hilton on Bay Street South, plus the condo redevelopment of 150 Main Residential Lofts, the former federal building at 150 Main Street West.

I have shown my commitment to the City by moving my company's head office to downtown Hamilton.

Given this, it is very hard for any private sector person investing in Hamilton such as myself to understand why some on Council is contemplating turning their backs on $1 billion in provincial investment in our City.

Be assured that many developers, myself included, are watching the LRT initiative very closely.

If the LRT initiative was, for some reason, not to go ahead, it would send a very negativ message about the direction of the City to developers both inside and outside the City.

If it goes ahead, as it should, it will mean significant private sector investment, not only raising property values but giving the entire City significant economic uplift.

How do I know this? We do not need to look to distant European cities for proof, although there are many examples there to be found. We have already witnessed significant economic uplift right here in Hamilton on the East Mountain with the building of the Red Hill Valley Parkway. I think it is fair to say that many in Hamilton now take the Red Hill parkway for granted and today could not imagine the City without it. The long and tiresome debates about building the Parkway today seem like relics of the past.

The LRT initiative is a different kind of transportation project but we can be assured it will result in uplift just as the Red Hill Valley Parkway has done.

I can tell you that anecdotally those developers are keenly interested [in] the opportunities that the LRT initiative will provide. The City has made all the right moves by ensuring that the zoning is in place to allow this uplift to happen. I predict that, once ground is broken on the LRT initiative, there will be a flood of new development proposals all along the LRT corridor.

I believe in a positive and successful future for Hamilton. I urge you to join me in this positive vision for the future and allow Hamilton's LRT initiative to go forward.

Yours truly,

Darko Vranich
President & CEO
Vrancor Group Inc

Please take a few moments to tell Council to take YES for an answer, reaffirm its support for LRT and accept the full capital funding from the Province that Council has consistently voted for since 2008.

Ryan McGreal, the editor of Raise the Hammer, lives in Hamilton with his family and works as a programmer, writer and consultant. Ryan volunteers with Hamilton Light Rail, a citizen group dedicated to bringing light rail transit to Hamilton. Ryan writes a city affairs column in Hamilton Magazine, and several of his articles have been published in the Hamilton Spectator. He also maintains a personal website and has been known to post passing thoughts on Twitter @RyanMcGreal. Recently, he took the plunge and finally joined Facebook.

While not everyone likes Darko, there appears to be some kind of need to keep incubating developers (but not at an irresponsible level) to help improve Hamilton's appeal. It's certainly getting better -- taking decades in many cases (e.g. Lister Block FINALLY got saved and renovated, for example) -- but the pace is finally gradually picking up and looks like it's set to accelerate dramatically in the years to come.

It's important to note that as Hamilton improves, the city will have a better choice/selection of developers and can be more discerning -- to choose developers that can more benefit the people of Hamilton as a whole, things like mixed-income housing and creating new local businesses that hires locals, adding new retail, etc. Turning away developers doesn't help the local poor, nor is accepting unfettered development either -- it needs to be done in a measured way.

As an example of a gradually/slowly improving situation, please see this post where new, more jobs are occuring.

By ref_erendum (registered) | Posted May 26, 2016 at 11:46:38
in reply to Comment 118809

"(e.g. Lister Block FINALLY got saved and renovated, for example) -- but the pace is finally gradually picking up." Yes but at what cost to the taxpayers of Hamilton. Please read the leasehold agreements the city has as well as the final purchase price of this building in 20 + years from now. The taxpayers will be paying an exorbitant amount of money for this property to the investors. Only until the City paid up did these developers (Liuna I think) bring that building back to its old glory in a short period of time. In no way will the overpayment of this property justify what council has done. LRT will NOT revitalize Hamilton. But investing in the infrastructure in Hamilton and surrounding areas is the purpose of our tax dollars. Lets keep city hall out of the Private investment market.

My opinion is that the city will have a better choice/selection of developers and can be more discerning.

There needs to be a solid base of improvements before that happens. While I strongly advocate for things like mixed income developments and not leaving the poor behind -- I also understand the balance needed of reaching the needed critical mass before being able to fully stop incentivizing developers. The situation is getting better piecemeal, and more needs to be done. (e.g. the waterfront development is being sold off in 3 phases -- the 1st phase is sold cheap but the 2nd and 3rd won't).

"LRT will NOT revitalize Hamilton."

You might be surprised to hear that I agree: It can't revitalize Hamilton by itself alone.

But the LRT is a very important component of many that will help hugely in help set the city in the correct direction.

Yes, the city need to also simultaneously work on many concurrent initiatives. Low income housing included. Even now, the LRT design is already much better than Edmonton's which often has been the source of derison. Simultaneously, you can look at Kitchener-Waterloo to see examples of many concurrent initiatives they are doing alongside the LRT, including in the housing department as well (problems aside, they are working on this better than Hamilton).

Oh it's extremely concerning to developers? A group of millionaires who are bent on displacing the lower class by gentrifying the downtown core?

Clearly, this man has read the reports that say an LRT will increase property values. He owns a lot of property. All he wants is more money. He couldn't care less about transit solutions for the poor. How can Raise the Hammer not see that? I've lived in Hamilton all my life and because of gentrification I may not be able to live here much longer. Rents are skyrocketing due to profiteers like Darko. Let's keep corporatism out of the LRT debate please.

We also need to take care of those left behind -- steel pensioners, mixed income developments, etc -- even as new industries (high tech, etc) come in. More free retraining opportunities are needed, and we need to expand/market the initiatives better like the free Cityschool Mohawk (free courses that count as a credit towards your degree), where people who might have difficulty getting jobs in newer/diversified industries arriving in Hamilton as we speak, need to be accommodated.

We must repair the holes in the other boats to allow the rising tide to lift those boats too.

By Deleted User (anonymous) | Posted May 26, 2016 at 09:23:07
in reply to Comment 118798

It's simply not true. The rich get richer while the rest of us are left behind. Wealth is being concentrated at an incredible rate. The 60 richest people on the planet have more wealth than the bottom 3 billion people. Darko can increase his wealth tenfold; it won't help the lower class in anyway.

By stone (registered) | Posted May 26, 2016 at 10:19:57
in reply to Comment 118799

Leaving the city the way it is won't help the lower class in any way either. The relatively new phenomenon of people wanting to live in urban centres instead of suburbs is not localized to Hamilton and will continue whether there is an LRT or not.

By ergopepsi (registered) | Posted May 26, 2016 at 10:16:06
in reply to Comment 118799

Downtown Hamilton is not even close to being gentrified. Not even close. There is an overabundance of low income residents that don't have the ability to spur the economy. You need an injection of people with some disposable income to bring some economic life to the area. That will help more people than it will hurt. And yes some low income people will be displaced and that needs to happen for the betterment of the entire area. In 10 or 15 years we can worry about gentrification. Until then let's keep focusing on providing CPR for the core.

and what's with the 'lower class' bit? Yikes...

Comment edited by ergopepsi on 2016-05-26 10:20:54

It goes down like steel wool but comes out like an angel from heaven.
-Mr Krabs

It's a lot less empty than the 90s, and will progressively become less empty as the new condos populate (Connolly, Royal Connaught, 150 Main, and many others), more condo and retail planned, and the developments begin to fill the parking lots, waterfront, etc. IBM just moved in, I also hear about Bell Canada (big surge of Bell Hamilton jobs posted on the job sites), and a lot of new businesses are eyeing Hamilton.

And not to mention big downtown boom of mini-incubators, small high tech, co-work spaces (The Forge, Mixed Media, Factor-e, Wise&Hammer, and dozens of others downtown)

And it's important to remember James St N of the 90s after the steel jobs decimation and Eaton Centre bankruptcy.

And that waterfront plan, and those upcoming consultations on new Hamilton transit zones (..involves densification...), etc.

Yes, we do need to codify things like mixed-income housing and making sure the poor is not left behind. The city must work to gradually improve our ability to do this.

In the past, big Hamilton plans have come and gone, yes, but more of the plans are catching-on nowadays, and sustainable economic growth is now being achieved.

combined with modern transit priority signalling to quickly zoom through green lights means the LRT will usually not stop except at LRT stops. (more info) ....

What Hamilton LRT is getting is more similiar to ION LRT rather than the Spadina TTC route, or the poorly-designed St. Clair TTC streetcar route. Also Hamilton LRT's pantograph is slip-proof and far more bad-weather resistant, unlike streetcar trolleypoles. Also, it is a lot less boring and stressfull as a standee on rails than on a bus, since the acceleration/deceleration is so predictable as a standee, you can literally much more comfortably stand (merrily using your smartphone or newspaper) without needing to grab a pole often. Something that's much harder to do with a bus. Historically, elsewhere, the retired dread peak-hour buses more than subway/LRTs, lest they fail to sit down before the bus starts moving unpredictably.

While it is right to be angry and frustrated at how taxpayer money is spent (I am too -- but for different reasons) -- there are some errors in your post so I am not going to bother replying in full. Here's a partial reply, however.

A major bus expansion/rejig will be happening, as part of the plan -- it has been brought up many times with some foot dragging and the current debate is (probably) actually helping accelerate this. We may eventually find out that the departure of Dixon, will hopefully be helpful in respect to this. Seeing a large HSR fleet expansion and the new bus garage will be good Hamilton-wide. LRT amplifies connecting bus routes, and HSR needs to take advantage of this. HSR is able to have better systemwide farebox recovery despite the loss of the 10 B-Line Express, with other cities successfully improving farebox recovery of a bus network connecting to a new LRT.

One major blooper in your post -- they are working to integrate fares with revenue transfers to municipal, etc -- it's even listed on the MetrolinxEngage website. Fix your errors, and I may reply in fuller text. Others can dissect your post. Good day.

By ref_erendum (registered) | Posted May 27, 2016 at 14:23:33
in reply to Comment 118821

No errors... Mr. Paul Johnson stated at a meeting in Westdale the revenue generated was under discussion with a third party, Hamilton was not in that loop. Metrolinx can gloss over their site as much as possible, but there are too many holes so far for them to fill with the real truth.

How about a bit less YELLING IN ALL CAPS and a bit more honest engagement.

Also, for someone who seems to hate paying taxes, it is bizarre to me that you identify as a "taxpayer" rather than, you know, a citizen.

As for a referendum, LRT is not one big decision but a large number of decisions, many of which have already been made after extensive research, widespread public engagement and careful consideration by our elected leaders at two levels of government. You cannot reduce a big, complex, long-term strategic project to a single faux-populist question and expect anything other than a gong show.

By ref_erendum (registered) | Posted May 27, 2016 at 14:05:36
in reply to Comment 118828

Sorry Ryan I am not yelling simply typing with one finger . I never said anything about hating to pay taxes only about wasting tax dollars on a money loser for Hamilton. Metrolinx(Paul Johnson) has stated at the last Westdale meeting that money generated will go to Metrolinx or a third party not Hamilton. ( not as mdrejohn claims)) In 2012 the City Motor Hotel (2013) was purchased for $1.96m and it was stated (Hamilton Spectator Sept 13,2012 )that it would be the LRT hub. Yet Metrolinx as well as the city has been saying for several years and even with their rendered picture (2015) that Eastgate was to be the hub ( now who is misleading who?) I am sorry but too many questions unanswered with regards to the actual costs, time frame,revenue etc for us to jump on this bandwagon. Conveniently Mr. Dixon leaves and clearly in his report to council an LRT in Hamilton does not have the sustainable ridership to support this project. Metrolinx projections are highly inflated. The shovel is not in the ground so all is not wasted and done until the fat lady sings. Time for a Public Referendum not a gong show.

By OED (anonymous) | Posted May 27, 2016 at 15:16:18
in reply to Comment 118863

Eastgate was always going to be a terminus of the LRT line until it was announced funding was only to the traffic circle. Why couldn't the traffic circle serve as a hub along the line regardless of where it terminated? The traffic circle is now the terminus of the line. Big deal.

By ref_erendum (registered) | Posted May 27, 2016 at 14:15:19
in reply to Comment 118817

Part of the $120mil business development loan the City (Bank) of Hamilton has was given to Mr. Vranich included in the $200mil building investment is here in that building. Do you really want him to tear it down. Hmmm ,maybe if the city calls in his loan we can take over all the projects.

Right now Hamilton has a problem with buses in it's downtown core on John. At least 3 times an hour there is a huge back up of 6-8 buses from Main street, sometimes as going as far south as Augusta. Mountain buses and lower city buses all converge on that one spot in mixed traffic but it's not even useful as a transfer point as there seems to be no consideration for buses arriving from the moutain by lower city buses which will leave before a ransfer can be made. Part of the problem are the one way streets in the area direct everything to that point, but mostly it just seems like bad planning

By ref_erendum (registered) | Posted May 27, 2016 at 14:18:13
in reply to Comment 118820

Mr. Dixon had a small answer to the solution but his honest report ran him out of town by Metrolinx and the Mayors office .....I would still like to know what Terry Cooke and the Mayors office have
under their sleeves.